The demand for Team 1's wins is: P1(w1) = 200 100(w1) where w1 indicates Team 1's winning percentage. The demand for Team 2's wins is: P2(w2) = 100 50(w2) They are the only two teams in the league so w1 + w2 = 1. Suppose that the league institutes a revenue sharing agreement where each team pays the other team = 0.2 share of their revenues.

a) What is each team's marginal revenue after revenue sharing, MR 1 and MR 2 ?

b) What are the equilibrium winning percentages?

c) What is MC? What is the payroll of each team?

d) Graph the equilibrium after revenue sharing. Label all relevant intercepts and values.